07/08/2011 Market Outlook (Could see some weakness the next week)

Cobra's Market View Private Messaging System shows:

SHORT-TERM: COULD SEE SOME WEAKNESS THE NEXT WEEK

Two cents:

Could see some weakness the next week, at least won’t rally huge.

Still expect higher high ahead as mentioned in 07/07 Market Outlook. The reason I reiterate here is to imply, although I expect some weakness the next week, but I don’t mean drop right away, could be some back and forth, and usually the 07/07 highs would be revisited first.

Why expect some weakness the next week?

As mentioned in 07/08 Trading Signals, red Non Farm Payroll day most likely means a reversal. The chart below highlighted all the red Non Farm Payroll days since the 2009 bull market. Clearly we can see there’s only 1 exception out of 10, so although superstitious it sounds but the odds just are too high to be ignored.

Although the Friday intraday feels very bullish but the fact the daily hollow red bar formed near highs usually means a top, besides, the ChiOsc is way too high now.

Nothing on Earth is beyond gravity, so MACD Hist cannot stay high for ever, the chart below at least doesn’t agree a huge rally the next week.

The chart below is from Schaeffer, seems bearish on July Expiration Week.